MetLife Inc.on March 30 cheered a federal court's rulingfreeing it from oversight as a nonbank systemically important financial institution,saying it "validates" the company's decision to challenge the Financial Stability Oversight Council.
The U.S. District Court of the District of Columbia sided withthe insurance giant in the high-profile case, ordering the FSOC to rescind its of MetLife as a nonbankSIFI. The insurer is the first to challenge the FSOC's nonbank SIFI designationsin court. It first filed suit in 2015.
"Today's ruling validates MetLife's decision to seek judicialreview of our SIFI designation," Chairman, President and CEO Steven Kandariansaid in a statement. "From the beginning, MetLife has said that its businessmodel does not pose a threat to the financial stability of the United States. Thisdecision is a win for MetLife's customers, employees and shareholders."
The federal government has 30 days to appeal the decision. TheU.S. Treasury Department in a statement did not confirm that it will appeal butsaid it would continue to fight on behalf of the FSOC's designation process.
"We strongly disagree with the court's decision," aTreasury spokesman said. "We are confident that FSOC's determination was lawfuland will continue to defend the council's designations process vigorously."
But state insurance regulators broke with their federal counterparts,applauding the court decision and throwing their support behind MetLife. NAIC Presidentand Missouri Insurance Director John Huff said in a statement that the FSOC's initialdesignation of MetLife was "inappropriate" and disregarded the state-basedinsurance regulatory system, while North Dakota Insurance Commissioner and representativeto the FSOC Adam Hamm called it a victory for the states' perspective on insuranceregulation.
"I'm very encouraged to see the court show support of ourlong-time point of view," he said. "I look forward to reviewing the court'sdecision and continuing to work with the Financial Stability Oversight Council togain full recognition of the state-based system of insurance regulation as a meansto prevent risk in the insurance sector."